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Colorado wants midterm review of oil shale research, development

The state of Colorado has told the federal government it should conduct a “midterm review” of oil shale research, development and demonstration leases before it considers issuing more of them.

The state based its comments on a lack of action on the lease parcels by the companies holding leases. It submitted its letter Thursday, the deadline set by the Department of Interior for comments regarding a possible second round of leases.

Also Thursday, 16 conservation groups told the Interior Department they opposed more leases.

“Oil companies already own extensive oil shale lands, so it is not necessary to open new federal lands to research,” Karin P. Sheldon, executive director of Western Resource

Advocates, said in a news release from the groups.

In its own submitted comments, the American Petroleum Institute voiced support for expanding the Bureau of Land Management’s RD&D program “to enhance competition and technological innovation.”

In its initial round, the BLM issued six of the leases — five in Colorado and one in Utah.

They granted the right to test and develop technologies on 160-acre tracts of public land, and if the technologies are successful, to seek conversion to a commercial lease on the 160 acres and a contiguous 4,960 acres.

During the last days of the Bush administration in January, the government decided to issue a new round of RD&D leases.

But in February, new Interior Secretary Ken Salazar delayed action on the leases, instead providing for a public comment period.

The first leases were for an initial 10-year period. In its letter, the state said that nearly a quarter of the lease period has passed, and none of the tracts has been permitted for active mining, and construction activities haven’t begun on them.

It recommended an assessment “to determine their technology status, the relevant economics, the resource demands, and the obstacles preventing more substantial progress.”

Shell holds three of the Colorado leases. The company previously has indicated it is moving deliberatively on its oil shale project but plans to make use of its federal leases.

Last year, the BLM identified land for potential commercial oil shale development and adopted development rules. Conservation groups sued the government to challenge those actions.

Earlier this month, over the objections of the groups and the government, a federal judge agreed to let the American Petroleum Institute intervene as a defendant in one of the cases and to let Shell intervene in both cases.